09.08.10 01:53 Age: 8 yrs
Further Regulations on Pre-Tax Deduction For Public Welfare Donation Released
Following the “Notice on the Pre-tax Deduction for Public-Welfare Donation” released by the Ministry of Finance (MOF) on Dec 31, 2008, the “Supplementary Notice concerning Issues Related to Pre-tax Deduction for Public-Welfare Donation” (Notice) has been issued recently.
The Pre-tax Deduction for Public-Welfare Donation means that the donation expenditure paid by the enterprises or individuals for public welfare shall not be accounted in the taxation of the income. The pre-tax deduction is approved in the purpose of encouraging public welfare donations and compensating the donators.
While the notice released 2 years ago has made many detailed rules for the implementation of the pre-tax deduction, there are still some aspects needed to be completed. Thus the MOF issued a supplementary notice on July 21 of this year, concerning the further regulation of this matter.
In the Notice, it is prescribed that the income pre-tax deduction can only be subject to the donations through public welfare social organizations eligible for the pre-tax deduction or the people’s governments at or above the level of country as well as their department and affiliated agencies. And the application and obtain of the qualification for pre-tax deduction for public welfare donations are also further regulated.
“Though the Supplementary Notice only consists of 7 articles, it has made very specific rules about the qualification of the social organizations or foundations for pre-tax deduction for public welfare donations. If the donator wants to get a pre-tax deduction for public welfare donation, make sure the organization or foundation has got and is maintaining the qualification.” commented Edward E, Lehman, Managing Director of Lehman, Lee & Xu.
Lehman, Lee & Xu is a prominent Chinese corporate law firm and trademark and patent agency with offices in Beijing, Shanghai, Shenzhen, Hong Kong, Macau, and Mongolia. The firm has also been recognized as one of the top full service as well as intellectual property firms in China by several international magazines. The law firm is managed by Mr. Edward Lehman, a leading expert on corporate law with 20 years of practice experience in Mainland China.
To learn more about us, please visit our website at www.lehmanlaw.com .